New tools for the recovery of arrears
Starting this year, the tax authorities are not limited by local jurisdiction when recovering tax arrears. At the same time, from 1 July 2025, the customs administration can use a new power in the event of an u…
Legal News [November 2025]: Supreme Court confirms state preference for VAT deduction correction
The November selection of case law brings five decisions of the Supreme Court that reflect current interpretative shifts in the field of insolvency, labour and civil law. The court confirmed the constitutionality of the state's advantage in the correction of the VAT deduction and at the same time emphasized that when denying a claim in insolvency, it is necessary to evaluate its actual content, not just the formal classification of the objections. It also defined the employer's responsibility for occupational safety towards the self-employed and protected the validity of an individual agreement on reduced working hours without a reduction in wages. The final decision stated that the court in civil proceedings is not bound by the conclusion of the criminal court on the absence of co-fault if the insurance company did not participate in the proceedings.
- In its judgment file no. 29 ICdo 106/2024, the Supreme Court annulled the decision of the High Court in Prague, which refused to recognize the tax administrator’s claim on the basis of the correction of the VAT deduction as a claim equated with claims against the estate on the grounds that it was an unconstitutional advantage for the state. However, the Supreme Court emphasized that the judgment of the Constitutional Court No. Zn. Pl. ÚS 37/23 found this legal regulation to be constitutionally compliant and defensible, and therefore the tax administrator’s claims on account of the correction of VAT deduction in the case of an irrecoverable receivable remain receivables placed on an equal footing with receivables from the estate. The advantage of the state is provided for by law and has passed the proportionality test at the Constitutional Court.
- In the judgment file no. 29 ICdo 25/2025, the Supreme Court explained that when assessing the denial of the amount of a claim in insolvency proceedings , it is not possible to formally separate the objections directed against the authenticity and amount, but it is necessary to examine their actual content. If the insolvency administrator denies the amount of the claim, claiming that the debtor is not responsible for its occurrence (e.g. that he acted on the basis of unlawful execution orders), this may be a relevant reason for denying the amount, not only the authenticity. The lower courts therefore erred in rejecting such an objection as irrelevant. The Supreme Court emphasized that in the case of an unenforceable receivable consisting of default interest, the amount of interest can also be challenged by claiming that the default is only partially or not at all culpable, and the insolvency court must examine this argument on the merits, not reject it for formal reasons.
- In the case no. 21 Cdo 1325/2025, the Supreme Court dealt with whether an employer is also responsible for occupational safety at the workplace towards a self-employed person who performs activities at his workplace with his knowledge and works as a subcontractor of a third party. The subject of the dispute was the question of whether the responsibility for occupational safety can be transferred to the contractor and whether this employer can be sued for compensation for damage caused by an accident at work. The Supreme Court concluded that the obligation to ensure safety in the workplace under Section 101 (1) of the Labour Code. 5 of the Labour Code applies to all persons at the workplace who are there with the knowledge of the employer, regardless of their contractual status. This obligation cannot be contractually transferred to another entity, because the employer is liable for damage caused by insufficient safety of operation at the workplace.
- In the judgment file no. 21 Cdo 2173/2024, the Supreme Court dealt with a dispute over whether an individual agreement on reduced working hours without a reduction in wage, concluded while the old Labour Code (No. 65/1965 Coll.) was still in force, and whether the employer could later unilaterally change it. With effect from 2001, the employer and the employee have individually agreed on working hours in the range of 35.5 hours per week without a reduction in wages. In 2021, the employer unilaterally increased the employee’s working hours to 37.5 hours and reduced his wage, which the employee challenged. The Supreme Court upheld the conclusions of the lower courts that such an individual agreement was valid and binding, because the law did not prohibit it and allowed it to be inferred from the framework of the legislation of the time. The employer cannot unilaterally change or circumvent it through wage assessments, and therefore the employee must pay the wage corresponding to the originally agreed conditions.
- In its judgment 25 Cdo 2298/2024, the Supreme Court addressed the question of whether the court in civil proceedings between the injured party and the insurer is bound by the conclusion of the criminal court, which showed that the injured party did not participate in the occurrence of the damage if the insurer did not participate in the criminal proceedings, although he was informed about them. It concluded that there is no such binding obligation – the court deciding on the injured party’s action against the insurance company must assess the issue of complicity separately. An insurer who was not a party to the civil proceedings cannot be limited by the conclusions of the criminal court, as this would be contrary to the right to a fair trial. The Supreme Court therefore annulled the decision of the lower courts and returned the case for further proceedings.
